Authorized Signer vs. Joint Owner - FineMark National Bank & Trust (2024)

FAQs

What is the difference between authorized signer and joint owner bank account? ›

And an authorized signer's privileges are only legitimate while the account owner is alive. A joint owner, with the right of survivorship, allows the new joint owner complete access and rights to the funds in the account. They can also remove funds and close the account.

A co-owner has full access to the account and will legally own the proceeds of the account after the other account owner's death. A co-signer simply has authority to write checks and draw on the account.

With a joint account, both people can make purchases, and both are fully responsible for the bill; with an authorized user setup, both can make purchases, but only one is legally liable for paying.

Each account owner can get a debit card, write checks and make purchases. Both account holders can also add funds or withdraw them from the account. The money in joint accounts belongs to both owners. Either person can withdraw or spend the money at will — even if they weren't the one to deposit the funds.

If you want to help someone build their credit or access to a credit line for emergencies but are willing to cover their charges, adding someone as an authorized user may be a good idea. But if you want them to be equally responsible for the payments, a joint credit may be a better choice.

An authorized signer can access your account and perform transactions, such as paying vendors or transferring funds. Adding an authorized signer can make business banking easier, but before you make this decision, be sure you understand the risks.

Authorized signers typically can make deposits and withdrawals (including writing checks and using the account's debit card). Authorized signers can only act on behalf of the account owner and have no personal ownership rights to the assets.

Adding a Signer

The big difference, is that a secondary signer doesn't have legal responsibility for the account (or for any fees it may incur). It's important to note that adding a signer to your account is not the same as adding a co-owner.

Both owners of a joint bank account own the money in it equally. That means you have the ability to deposit and withdraw funds as you wish – and so does the joint account holder. Since both people have equal ownership and access to the money, it's important to set boundaries regarding how the account will be used.

By adding an authorized signer to your business's bank account, you're granting them access. Depending on how you set up the agreement, they might have permission to: Check the balance. Sign checks on behalf of the account. Pay bills and transfer funds to other accounts.

Who owns a joint account when one person dies? ›

Joint bank account holders generally have the right of survivorship, which grants the surviving account holder ownership of the entire account balance. The surviving account holder retains ownership regardless of which owner contributed the money, and the account doesn't go through the probate process.

A joint account might damage your credit score

Opening a joint account adds a financial link to the other person. This means companies will look at both of your credit histories as part of any credit checks. If they have a poor credit history, this might lower your chances of acceptance.

Each person on the account has the legal authority to use the entire account balance for any reason. In contrast, a person holding a power of attorney also has access to the grantor's bank account, but he or she is legally required to use those funds for the benefit of the grantor.

Beneficiaries can only receive the money in your accounts in the event of your passing. Beneficiaries can become joint account holders if you would like them to have access to your money before you pass. If your account already has a joint account holder, you do not need to designate them as a beneficiary.

While most banks won't let you remove the other joint account holder without their permission, many will allow you to remove yourself. Your bank can walk you through removing yourself from a joint bank account. You may need to submit a written request or go in person for a scheduled appointment.

The easiest way to tell is to check your statement in online banking under Statements or on the printed copy of your statement. The name listed first is the primary account owner. Joint account owners are listed under each share account as you view down the statement.

Can I Add Someone to My Bank Account? Yes, you can add another person to your existing savings account or checking account. It's a simple and common process, which turns an individual savings or checking account into a joint one. Before you do this, though, consider how it'll work and what rules you'll both live by.